Carlsberg Tightens Grip on Chongqing’s Breweries in Chinese MoveClementine Fletcher
Carlsberg A/S, the world’s fourth-biggest brewer, said Chongqing Beer Group Co. accepted its 1.56 billion-yuan ($257 million) offer for eight Chinese breweries as the Danish beermaker steps up expansion in Asia.
Carlsberg will buy 100 percent of Chongqing Beer Group Assets Management Co., a Chongqing, China-based holding company, according to a statement yesterday. The holding company owns breweries in the Jiangsu, Anhui and Zhejiang provinces, with capacity of about 12 million hectoliters.
The transaction comes less than a month after Carlsberg paid about 2.9 billion yuan to increase its stake in Shanghai-listed Chongqing Brewery Co. to about 60 percent from 29.7 percent.
The Copenhagen-based brewer is seeking to expand outside its heartland of Europe, where tough economic conditions are weighing on beer consumption, and Russia, where government restrictions on the sale of beer and tax increases on alcohol have led to a declining beer market.
Carlsberg’s controlling shareholder signaled in October that it will give the company more leeway to pursue deals. The brewer has been targeting Asia, where booming economic growth helped it boost volume 7 percent, excluding acquisitions and disposals, in the first half of the year, compared with a 5 percent decline in Western Europe. It announced a tie-up with Thailand’s Singha Corp. in September 2012.
The breweries involved in yesterday’s transaction sell brands licensed from Chongqing Brewery, as well as the Tianmuhu brand. The acquisition is subject to regulatory approval.